Saturday, 21 July, 2012

NEW DELHI

AFP

India’s home ministry has re-fused to allow three Iranianbanks to open branches on In-dian soil because of concernsabout money-laundering andterror financing, a report saidon Friday.

The move complicatesNew Delhi’s efforts to settle its

oil trade bills with the IslamicRepublic, the Indian Expressdaily reported, quoting an un-named home ministry officialfor the report. The ministry hasdenied security clearance toapplications by Parsian Bank,Bank Kasargad and Eghtesad-

e-Novin Bank because of its ob-ligation to guard against money

laundering and terrorist financing, the

newspaper said. There was no immediatecomment from the home ministry. Fuel-scarce India plans to import 15.5 milliontonnes of crude oil from Iran this year.

It has faced difficulty in finding banksto transfer payments to Iran due to US-ledfinancial sanctions against the Islamic re-public that have dried up dollar paymentroutes. To help circumvent this, India andIran clinched a deal under which NewDelhi would pay for close to half of itsIranian oil purchases in rupees.

Allowing branches of Iranian banks toset up in India would made it easier for In-dian firms to boost rice, tea, yarn, fertiliserand textile exports to Iran as well as facil-itate cooperation on engineering andother projects.

Iran will use the rupees it receives foroil to buy Indian goods. Large delegationsfrom each country have already made vis-its to explore trade opportunities.

Transactions are now routed in euro

payments through Turkiye Halk Bankasiand 45 percent of crude payments in ru-pees through India’s state-run UCO Bank.

India’s Department of Economic Af-fairs plans to ask the home ministry to re-consider its decision, citing “strategiccompulsion” for the opening of the Iran-ian bank branches, the newspaper said.

Iran is also looking to India for trans-fer of technology to modernise its textileindustry and investments in a railway cor-ridor to connect Iran to Caspian Sea coun-tries.

India, which imports four-fifths of itscrude, says it shares the US anti-nuclearproliferation goals. But it also views Iranas an important source of oil to feed itseconomy’s fast-growing needs and seesIran as a key ally in stabilising Afghanistanfollowing the US planned troop exit.

The United States says Iran’s nucleardrive is aimed at making an atomic bombbut Iran insists it is for civilian energy.

No bank branches on our soil,

But we sure do need

KARACH

STAFF REPORT

AFTER a three-year gap the banks have sur-passed the agriculture credit disbursement targetduring FY12 by loaning Rs 293.8 billion to theagriculturists during July-June of last fiscal year,the central bank reported Friday. It may be

pointed out here that the banks had been missing the farm loanstargets since FY2008-09. “Achievement of disbursement targetduring FY12 was extremely difficult in the backdrop of continu-ous declining trend in the overall Private Sector Credit and highagriculture Non-Performing Loans of major banks due to dev-astating floods of 2010 and heavy rains of 2011 in Sindhprovince,” said the State Bank.

The credited amount, it said, is Rs 8.8 billion or 103 percentmore than the annual indicative target of Rs 285 billion set bythe Agricultural Credit Advisory Committee (ACAC) for theFY12. “It is 11.7 percent higher than Rs 263 billion disbursed in2010-11,” the regulator said. A bank-wise break-up shows thatthe five large banks collectively disbursed agriculture loansamounting to Rs 146.3 billion or 103.7 percent of their annualtarget (Rs 141 billion) in fiscal year 2011-12, higher by 4.3 per-cent compared to Rs 140.3 billion disbursed during FY2010-11.

The National Bank of Pakistan, Habib Bank Limited, MCBBank, Allied Bank Limited and United Bank Limited surpassedtheir annual targets by achieving 106.0 percent, 103.5 percent,103.3 percent, 102.8 percent and 100.7 percent disbursement, re-spectively. The Zarai Taraqiati Bank Limited disbursed Rs 66.06billion or 94.2 percent of its annual target of Rs 70.1 billion whilePunjab Provincial Co-operative Bank Limited by disbursing Rs 8.5

billion or 112.1 percent surpassed its annual target of Rs 7.6 billion.The 14 domestic private banks as a group achieved 112.5 percentof their target that accounts for Rs 54.1 billion and disbursed Rs60.9 billion. The Bank of Khyber, Bank Al Habib, Faysal Bank,Soneri Bank, NIB Bank and Askari Bank surpassed their annualtargets by achieving 174.6 percent, 147.6 percent,136.7 per-cent,132.4 percent,104.1 percent and 100.4 percent disbursement,respectively, while other remaining banks could not meet their an-nual targets. The five microfinance banks as a group disbursed Rs12.1 billion or 99.3 percent of their annual target of Rs 12.2 billion.It may be pointed out here that the banks had been missing thefarm loans targets since 2008-09. The central bank attributes theachievement of fiscal target to “a multi-pronged strategy” and theall out efforts it had made for achieving ACAC’s target.

SINGAPORE

INP

Standard & Poor’s Ratings Services Fri-day affirmed its ‘B-’ long-term sovereigncredit rating on Pakistan. The outlook onthe long-term rating remains stable.

Standard & Poor’s also affirmed its ‘B-’ issue rating on Pakistan’s senior unse-cured foreign- and local-currency debt andits ‘B-’ transfer and convertibility assess-ment. At the same time, it raised the short-term sovereign credit rating to ‘B’ from ‘C’,following a change in criteria that linkslong-term ratings with short-term ones.

The sovereign ratings on Pakistan takeinto account the country’s weak fiscal pro-file and associated high public and exter-nal leverage, low income level, as well asthe underlying weak political and policy

setting. These constraints are balancedagainst strong remittance inflows thathelp sustain a still-adequate external liq-uidity position.

Pakistan’s high public and externalindebtedness is a main rating constraint.Net general government debt stands atan estimated 52% of GDP in 2012, 40%of which is external debt.

“The interest burden on this debtposes a great constraint on discretionaryspending, given already sparse fiscal re-sources,” said Standard & Poor’s creditanalyst Agost Benard. “The large interestbill and other expenditure-side rigiditiesagainst a narrow revenue base of about12.5% of GDP result in ongoing fiscalslippages.”

The country’s political and securityenvironments also constitute a rating con-

straint. A volatile, fragmented, and adver-sarial domestic political setting detractsfrom policymaking and implementation.The resulting weak macroeconomic con-ditions, together with regional insurgen-cies, sectarian strife, and weak governancestandards are a significant deterrent forprivate sector investment.

“Our ‘B’ rating category considers thepotential of administrative weaknesses toresult in payment delays from ministriesto agencies,” Mr. Benard said.

The ratings on Pakistan are supportedby the country’s adequate foreign currencyliquidity. Buoyant remittance inflowsfrom a geographically well-diversified off-shore labor force and large Pakistani dias-pora amount to 5.6% of GDP, having risenmore than threefold in nominal termsover the past seven years.

No reasoN to ‘be Negative’S & P affirms Pakistan long-term rating at ‘B-’; outlook stable

Old Macdonald can nowhave a farm in PakistanKARACHI

ISMAIL DILAWAR

The salaried class, who are the worst hit bythe persistent double digit inflation, wouldsee their Zakat exemption limit shrinking by17 percent this year.

To be deducted by the banks on first dayof the holy month of Ramadan, the “Nisab ofZakat” for 2012 (Zakat year 1432-33 A.H)has been set by the federal government at Rs51,086.

Last year, the government had relievedthe salaried people, who maintain savingsaccounts in banks, by doubling the Zakat ex-emption limit to Rs 61,336 from Rs 29,385of the preceding year, 2010.

The measure was expected to provide re-lief to the salaried class.

This year, however, the limit for theholders of saving accounts has been de-creased by Rs 10,250 or 16.7 percent com-pared to 2011.

According to official sources, the amountof deductible Zakat is determined as permarket price of the 52-tola silver. On Friday,in the open market per tola silver was pricedat Rs 974.68 that when multiplied with 52tolas totals at Rs 50,683.36.

The State Bank has asked the banks thatthe Zakat shall be deducted as per instruc-tions of the notification issued by the Min-istry of Religious Affairs last Wednesday.

The ministry, in the notification, askedthe central bank to convey to the banks andall financial institutions that the Administra-tor General Zakat had set the deductible

amount at Rs 51,086.“No deduction of Zakat at source shall be

made, in case the amount standing to thecredit of an account in respect of the assetsmentioned in column 2 of Serial No. 1 of thefirst schedule of Zakat and Ushr Ordinance,1980, is less than Rs 51,086 on the first dayof Ramazan,” reads notification number CE-1001(36)/NISAB/1432-33/2012.

Subject to sighting of the moon, theZakat would be deducted by the banks on thefirst day of Ramadan, being a bank holiday,which is likely to fall on Saturday or Sunday.

The Zakat would be minused from thesaving bank accounts, profit and loss sharingaccounts and other similar accounts havinga credit balance of Rs 51,086.

“All the Zakat Collection ControllingAgencies (ZCCAs) are requested to deductthe Zakat accordingly,” said the ministry.

When deducted by the banks the Zakatmoney is deposited in the Central ZakatFund being maintained by the federal gov-ernment with the State Bank of Pakistan.

Before the holy month starts, the accountholders, specially the low or middle incomedepositors who maintain saving accountswith the banks, rush to the banks to with-draw their deposits before the first Ramadanwhen the Zakat is deducted.

The bankers, however, suggest that in-stead of doing a hectic activity the accountholders should submit an affidavit seekingexemption from Zakat deduction. Most de-positors, however, do not tend to go for thisoption and withdraw their money before Ra-mazan to be deposited after first Ramadan.

Banks surpass Rs285b farm loans target after three years

Zakat exemption limit sees17pc cut to stand at Rs 51,086

Balochistan mustersWorld Bank’s attention

$5m MDTF grant for BDMP

ISLAMABAD: The World Bank has an-nounced the approval of US$ 5 milliongrant for the Khyber Pakhthunkhwa, Feder-ally Administered Tribal Areas andBalochistan Multi Donor Trust Fund(MDTF) and for the Balochistan DisasterManagement Project (BDMP), which willstrengthen the capacity of Provincial Disas-ter Management Authority (PDMA)Balochistan to prepare for, and respond to,natural disasters. Balochistan is prone tonatural disasters. Most notably, CycloneYemyin of 2007 and the historic floods of2010 resulted in significant losses to lifeand the economy. In 2011 again, several dis-tricts of Balochistan were adversely affectedby floods, said a statement issued by theWorld Bank here. “Balochistan has sufferedenormously following the drought in 2002,the cyclone in 2007, and the flooding in2010 and 2011. This project will allowPDMA Balochistan to better prepare for fu-ture disasters and lessen the losses throughimproved mitigation and response.” APP

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02Saturday, 21 July, 2012

Kashf announces partnership with Kiva

LAHORE: In continuation oftheir commitment to alleviatepoverty, leading MicrofinanceInstitution Kashf Foundationannounce their partnershipwith global non-profit organi-sation Kiva,a platform dedi-cated toconnecting globalaudiencesthrough onlinelending. The Kashf – Kiva as-sociation provides funds foron-lending, which enables theKashf Foundation to give ahigher number of loans tomore female entrepreneurs of

low income households.Kiva has committed to a facility ofUSD 3.2 million over the next 2 years which it will raisethrough online donations.

roots holds O/A-Levels guidance, counseling seminar

ISLAMABAD: Roots CollegeInternational Metropolitan G-8campus organized a highbrowand phrenic “O and A-LevelsGuidance and Counseling semi-nar” predominantly contrivedto aggrandize the educationalexperiences of students in orderto ameliorate their personal,scholastic, and career develop-ment. Idea sponsor Mr walidMushtaq’s initiatve is to create

and support proactive programs that help students to stimulatetheir intellectual growth, maximize their personal potential andmake their college years a productive and meaningful experience.

Warid brings exciting eid offer

KARACHI: This Ramadan, Warid Telecom brings an amazingoffer for its prepaid subscribers (both existing and new) . Uponusing balance of Rs. 15 per day and up to Rs. 50 during themonth, Warid subscribers will automatically enter in a luckydraw to get a chance to win 1 bumper prize of Rs. 1 Crore, 12Umrah packages, four 1300cc cars and 26 motorcycles!

Major Gainers

COMPANY OPEN HIGH LOW CLOSE CHANGE TURNOVERUniLever Pak 7300.00 7500.00 7125.00 7350.00 50.00 241Wyeth Pak Limited 901.13 924.99 919.00 921.83 20.70 40Siemens Pakistan 645.00 664.00 650.00 655.31 10.31 114AL-Abbas Sugur 92.13 96.73 95.00 96.70 4.57 4,135ICI Pakistan 162.57 167.89 158.99 166.78 4.21 265,955

Major LosersRafhan Maize Prod. 3475.00 3450.00 3301.26 3365.34 -109.66 161Nestle Pakistan Ltd. 4119.14 4100.00 4000.00 4091.15 -27.99 32Mithchells Fruit 300.94 297.00 285.90 285.90 -15.04 552Millat Tractors 510.64 518.00 503.00 504.55 -6.09 24,404Pak Suzuki Motor 111.28 115.75 107.00 107.43 -3.85 212,707

Volume LeadersJah.Sidd. Co. 16.40 16.23 15.40 15.48 -0.92 14,039,973Azgard Nine 7.18 7.07 6.49 6.58 -0.60 6,092,545Askari Bank 14.82 15.82 14.66 15.72 0.90 4,929,121K.E.S.C. 3.93 4.15 3.82 3.88 -0.05 4,821,677National Bank Pak 46.07 46.15 45.28 45.39 -0.68 4,118,508

Interbank RatesUS Dollar 94.4521UK Pound 148.4031Japanese Yen 1.2014

Dollar EastBUY SELL

US Dollar 94.20 95.00Euro 114.17 115.40Great Britain Pound 146.83 148.36Japanese Yen 1.1888 1.2011Canadian Dollar 92.38 93.85Hong Kong Dollar 11.98 12.17UAE Dirham 25.58 25.82Saudi Riyal 25.08 25.27Australian Dollar 96.98 99.44

Business

CORPORATE CORNER

KARACHI: Miss Umran Beba (right) RegionalPresident PEPSICO Asia Pacific talking tomoderate session for Pepsico under thebanner of WIBCON Forum at local hotel

LAHORE: Fatima Baig, a student ofChartered Institute of ManagementAccountants, has earned laurels forPakistan by achieving fourth position inthe May 2012 examination. Some 6,611candidates sat the exam worldwide.

ALL OVER THE MILKY WAY

AGENCIES/STAFF REPORT

INvESTORS booked profits on con-cerns for Moody’s downgrade of for-eign and local currency bond ratingsand Pakistan Banks deposit ratingsdespite strong corporate earnings out-

look. This was said by Ahsan Mehanti, Directorat Arif Habib Investments Limited.

The Karachi Stock Exchange (KSE) 100-share index declined 3.72 points or 0.03 percentto close at 14, 564.49 points as compared to 14,568.21 points of the previous session. The KSE30-share index shed 4.29 points to close at 12,623.90 points as compared with 12, 628.16points. The market turnover remains negativeand traded 96.121 million shares after opening at164.996 million shares. The overall market capi-talization declined 0.02 percent and traded Rs3.717 trillion as against Rs 3.719 trillion. Losersoutnumbered gainers 93 to 184, while 84stocks were unchanged. Mehanti added“Pakistan Stocks closed bearish amid insti-tutional profit taking on macro economic con-cerns.” The KMI 30-share was down by37.43 points to close at 25, 019.71points from its opening at 25, 057.14points. The KSE all-share indexclosed with a loss of 6.56 points to10, 245.25 points as against 10, 251.81points. The Jahangir Siddiqui Company wasthe volume leader in the share marketwith 14.039 million shares as it closedat Rs 15.48 after opening at Rs 16.40.Azgard Nine traded 6.092 millionshares as it closed at Rs 6.58 after

opening Rs 7.18. Askari Bank traded 4.929 mil-lion shares as it closed at Rs 15.72 from its open-ing at Rs 14.82. K.E.S.C traded 8.821 millionshares and closed at Rs 3.88 as against its open-ing at Rs 3.93. National Bank of Pakistan traded3.651 million shares as it closed at Rs 45.39 ascompared to its opening at Rs 46.07. He said thatthe Pakistan military aid cut by US, rising fiscaldeficit and security unrest in the city played a cat-alyst role in bearish sentiment at KSE. On the fu-ture market, the turnover decreased by over threemillion shares 5.771 million against 8.651 millionshares of Thursday. The Unilever Pakistan andWyeth Pakistan Limited, up Rs 50.00 and Rs20.70, led highest price gainerswhile, Rafhan Maize Prod andNestle Pakistan Limiteddown Rs 109.66 and Rs27.99 respec-tively, led the

losers.I S E -

1 0

FLAT: Islamabad Stock Exchange (ISE-10) hereon Friday witnessed bullish trend as the indexwas up by 2.53 as compared to the previous day’strading. Stock Analyst, AAH Pvt Ltd, ZaheerAhmed told APP that the news of reschedulingthe loans by Engro Corporation led the negativesentiments in the local stock market. Engro Cor-poration was scheduled to pay its loans but itcould not do so owing to its inability to pay atthis time, he said, adding this is temporary andthe market will perform better in the future.However, the buying was seemed in the selected

scrips, despite the investors preferred to besideline, he added. Total volume of shares

traded was 8,101, which was down by262,999 as compared to a day ear-

lier’s closing.ASIAN MARKETS

MIXED: Asian marketswere mixed in early trade onFriday after impressive ral-lies in the previous session

while investors took heartfrom another strong perform-

ance on Wall Street. HongKong added 0.22 percent by the

break, Sydney was flat and Seoulrose 0.30 percent but Tokyo slipped

1.00 percent and Shanghai eased 0.42percent. Shares on Japan’s Nikkei remained

under pressure after the yen strengthened inNew York against the greenback while it

continued to stay strong against the euro.Wall Street saw a third day of gains on

Thursday thanks to another round of up-beat earnings figures from some of the

country’s biggest firms.

Bull-bear deadlocksleft, right and centreMoody’s bears and corporate bulls fail to settle dispute in Karachi andIslamabad, while Asian shares had their own stalemates to deal with

PARIS

AGENCIES

France’s Socialist-dominated parlia-ment voted on Thursday to end taxbreaks on overtime work and raisewealth tax, abolishing two corner-stones of the economic policy con-servative former president NicolasSarkozy pursued over the past fiveyears. The measures were in abudget bill that France’s firstleft-wing government in adecade presented to the Na-tional Assembly after takingpower following FrancoisHollande’s presidential

election victory in May. In one vote, thelower house of parliament endorsedplans to scrap the tax-free status ofovertime hours from August onwards,

unstitching tax breaks that symbol-ised the “work more, earn more” slo-gan which swept Sarkozy to powerin 2007. The vote, first scheduled

for Wednesday, was delayed until afew hours before dawn on Thurs-

day by bickering be-tween Socialist

supporters and centre-right opponents who

say the measure willdamage people’sspending power.

La LibertÉ!France scraps tax breaks that symbolised Sarkozy era

ISLAMABAD

STAFF REPORT

The Oil and Gas RegulatoryAuthority (OGRA) conveneda hearing here today to re-view its LPG pricing formulaunder the directions of theLahore High Court. Thehearing degenerated intothreats of death and physicalharm against representativesof LPG marketing compa-nies. “We are deeply disap-pointed by today’sproceedings,” said Belal Jab-bar, spokesman of the LPGAssociation of Pakistan(LPGAP), a collection ofOGRA-licensed LPG market-

ing companies, and one ofthe petitioners againstOGRA. “One self-proclaimed‘chairman’ of LPG distribu-tors—who are not independ-ently recognized by OGRA inany case—stood up and is-sued threats of physical harmand death against the gath-ered representatives of LPGmarketing companies,” saidJabbar. “All this happened asofficials from OGRA and theMinistry simply sat by anddid not object, intervene orinterrupt this speaker.” Jab-bar said this so-called dis-tributors’ chairman alsoclaimed to have support fromthe Prime Minister.

OGRA’s LPG hearing results in ‘death threats’

WünDerBAr!Merkel gets Spanish bank bailoutthrough German parliament

BERLIN: Thelower house ofGermany’s par-liament re-soundinglyapprovedBerlin’s contri-bution to a eurozone-wide aidpackage for

Spain’s banking sector on Thursday. The Bun-destag backed the bailout by 473 votes, with 97votes against and 13 abstentions - far morethan the simple majority of the 583 memberspresent that Chancellor Angela Merkel needed.But Merkel fell short of a symbolically-impor-tant “chancellor majority” after 22 lawmakersfrom her own coalition voted against and oneabstained. This was slightly fewer than the 26coalition lawmakers who opposed the perma-nent bailout scheme and fiscal pact compact inparliament on June 29. The outcome of thevote had been largely a foregone conclusionafter the main opposition parties had signalledthey would back the package. AGENCIES

Dollar mixed in Asia

TOKYO: The dollar was mixed in Asian tradeFriday after earlier dipping on speculationthat an uncertain US economic recoverywould spur the Federal Reserve to usher infurther easing measures. The greenbackbought 78.56 yen in Tokyo morning tradefrom 78.59 yen in New York late Thursday.Against the dollar, the euro bought $1.2256fro $1.2282 while it was also weaker at 96.33yen from 96.48 yen. The euro, already underpressure over fears about Europe’s fiscalwoes, was also being sold against the Aus-tralian dollar which has been strong on highercommodity prices, dealers said. JunichiIshikawa, forex analyst at IG Market Securi-ties in Tokyo, said the common currency mayfall below $1.2230, “but with a lack of cues,there isn’t much direction”. Weak US joblessclaims and housing data on Thursday stokedexpectations for further Fed stimulus, whichweighed on the currency. AGENCIES

The latest to call foreurozone unity… IMF

ISLAMABAD: TheInternational Mone-

tary Fund (IMF)has called for de-termined actiontowards estab-lishing bankingand fiscal unions

in the euro area tobolster monetary

union. The euro area cri-sis has reached a critical stage, as financialmarkets in parts of the region face acute stress,said IMF in its latest assessment of economicdevelopments in the eurozone. GDP growth inthe euro area is expected to come in at -0.3percent in 2012 and 0.9 percent in 2013. Thepace of fiscal adjustment is particularly fast inthe hard-hit periphery countries, and this isweighing on the growth outlook. Projected con-solidation for 2012-13 ranges from more than 4percentage points of GDP in Cyprus, Portugal,Greece, and Spain, to 0.5 percentage points orless in Germany, Austria, Finland and Luxem-bourg. The rate of unemployment is expectedto continue to vary widely across the region—from 5 percent in Germany to about 24 percentin Spain this year. ONLINE

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